When the German global sportswear brand PUMA redesigned its standalone store in Bengaluru, India, expectations were high. The brand is hugely popular in India and is surging forward with a powerful year-on-year growth of 25 percent. However, of late, it has been facing stiff competition from a wide range of western clothing and footwear brands. Following relaxed restriction on foreign direct investment, which now allows 100 percent foreign-owned single brand retail operations in India, more than 300 international fashion brands are expected to open standalone branded stores in India by 2025. This will include PUMA’s fellow Germany-based brand adidas, which has plans to capitalize on the nationwide interest in athleisure, sports, and fitness by opening more than 1,000 stores showcasing its adidas and Reebok sports shoes and clothing. PUMA itself is opening new stores at a rapid rate of up to 10 shops in little over a month.
Even though the pandemic dampened its growth, India is fast emerging as one of the most attractive consumer markets outside Western Europe, with a rapidly expanding middle class that is forecast to grow by 1.4 percent a year, outpacing China, Mexico, and Brazil. The fashion market was worth $106 billion in 2020 and is forecast to be $190 billion by 2026, largely driven by well paid professionals who prioritize looking good. Meanwhile, the subcategory of sports apparel was valued at $498 million in 2020 and is expected to grow by 16 percent.
India’s geographic diversity and lack of established retail space mean brands need to have clear plans as to how to navigate the country and be able to quickly adapt to consumer needs. When eyeing India’s fashion boom, one of the major challenges that new global players face is that the clothing business is still quite fragmented. Recognized retail chains are a minority. Winning over customers in Asia’s largest economy is not a done deal. Innovation is being seen as key to encourage brand loyalty and bring Indian customers into the new generation of foreign-owned, branded stores. Retailers are using technology to enhance the instore experience, from digital displays to improved checkout processes. Customer experience is also paramount, which is why some chains are turning to augmented reality, bringing in the wow factor by displaying outfits on customers in virtual reality.
PUMA has clearly kept these developments in mind when deciding on the new layout of its Bengaluru store. The core concept it landed upon, much of which was inspired by PUMA’s flagship store in Fifth Avenue, New York, was to bring technology, sports, and experiential retail together under one roof. Thus, the center piece of the Indian store is an F1 simulator where customers can virtually race around the streets of New York. The idea is not just fun; it has great relevance to India too, following the success of the German brand’s motorsport sponsorship in the country.
There is also a customization studio, PUMA x YOU, where customers can personalize their own PUMA footwear and clothing, using embroidery and print. Interactive screens throughout the store enable customers to scroll through the entire product catalogue and, if they wish, place orders for shipping directly to their homes. The store also displays the one8 collection PUMA devised in collaboration with Indian cricketer Virat Kohli as well as a basketball collection celebrating the brand’s association with Indian basketball.
The innovative, digital-based solutions being used by PUMA sit well with shoppers in India, who are increasingly tech savvy. More than 900 million Indian consumers are online today, compared with a fraction of that number just over a decade ago, when there were just five million smartphones in a country of 1.2 billion people and only 45 million internet users. The authorities in India are keen to encourage investment from brands that are, in turn, determined to take advantage of India’s growth and which have the capital and resources to create innovative destination stores.

Question 7-1. Brands such as PUMA and adidas waited a long time to open up standalone stores in India. Trace the events and challenges that led up to this point.
7-2. What are the core values and strategy that PUMA wants to implement in India?
7-3. How has PUMA been able to localize its strategic implementation in India?